Stamp duty rise will hurt Queensland, says buyers' agents association

The Queensland government’s decision to cut the stamp duty concession from August 1 will definitely hurt the property market in the short term, according to the Real Estate Buyers' Agents Association of Australia president Byron Rose.

Queenslanders thinking of upgrading homes can avoid higher stamp duty fees if they exchange over the next month.

But suggestions there will be a flurry of buying activity in the market appear premature, with Rose warning that buyers need to be careful they don’t get caught up in a pricey rush to snap up properties before the changes to stamp duty kick in from August 1.

Rose’s comments come in the wake of the Queensland government’s recent decision to scrap the stamp duty concession for people trading up or downsizing to an existing home.

Under the new regulations, stamp duty on the purchase of a $400,000 home will increase from $5250 to $11,825, and those buying a $540,000 home will pay an extra $7,175 from August 1.

Stamp duty fees on a $1.5 million property will increase from $57,250 to $64,425 once the new rules come into effect.

Brisbane has a $430,000 median house price, according to the latest RP Data research.

The budget included a $140 million stimulus package of grants to first- and new-home buyers, but the trade-off was higher stamp duty on sales of most established houses.

“The decision to cut the stamp duty concession so swiftly is like ripping off a Band-Aid,” Rose says.

“If the Queensland government wants to kickstart the building industry, why doesn’t it provide concessions to the building industry rather than penalising aspiring home owners trying to step up the property ladder?

“REBAA believes that a confident and recovering housing market would deliver more to the Queensland economy than any short-term measures.”

The property analyst Michael Matusik has noted that although the stimulus measure is likely to boost construction of new homes, the stamp duty hike is yet another impost on the market.

“It’s sad that stimulus has been found from within the industry. In other words, they’re robbing Peter to pay Paul. It may backfire,” he says.

Matusik suggests stamp duty generally does not have much impact on sales prices, but the current buyers’ market means sellers might have to discount their properties further to clinch a deal.

He says the transfer tax system needs an overhaul, as it is holding people back from moving around the state.

REBAA Queensland spokeswoman Liz Wilcox says stamp duty is an unwelcome burden for anyone who wants to buy a home and fails to recognise the challenges that modern buyers face.

“As lenders demand greater deposits, buyers are already struggling to pay the huge capital outlay that stamp duty demands without an additional increase,” Wilcox says.

“It would be fair to say that stamp duty is one of Australia’s most unpopular taxes and is widely regarded by those buyers who pay it as being punitive and a serious impediment to anyone wanting to buy their own home.

“The decision to abolish the stamp duty concession in Queensland is a tax on ambitious home owners with no other purpose than to give the government as much cash from as many people as they can.

“The government should be doing more to aid housing affordability rather than encouraging more barriers to entry,” Wilcox says.